Insights 
VT 
West Texas Intermediate (WTI) oil prices rose early Wednesday in Europe, trading at $60.21 per barrel, up from $60.03. Brent crude also increased, moving from $63.85 to $64.01. WTI, known for its low gravity and sulfur content, is a highly refined quality oil sourced from the US and serves as a benchmark in the oil market.
Factors Influencing WTI Prices
The price of WTI oil is largely dictated by supply and demand, with global growth affecting demand levels. Political factors like wars and sanctions can disrupt supply chains. OPEC, a consortium of oil-producing countries, often influences oil prices with its production decisions. WTI oil prices are also impacted by the US Dollar’s value since oil is primarily traded in this currency.
Oil inventory data from the American Petroleum Institute (API) and the Energy Information Agency (EIA) also affects WTI prices. Weekly inventory reports highlight changes in supply and demand, where a drop in inventories signals increased demand, causing prices to rise. OPEC’s production quotas, determined biannually, can tighten or loosen supply, impacting WTI oil prices. OPEC+ includes additional countries like Russia, further affecting the market dynamics.
With West Texas Intermediate crude oil moving above $60 per barrel, we see some short-term bullish strength. This follows last week’s Energy Information Administration (EIA) report, which showed a surprise draw in U.S. crude inventories of 3.2 million barrels, signaling stronger than expected demand. We should watch this week’s inventory data closely to see if this trend continues.
However, the bigger picture on the demand side remains a concern for any sustained price rally. The latest global growth forecasts for 2026 have been revised down slightly, citing persistent inflation and slower industrial output in both Europe and China. This economic softness creates a significant headwind, likely capping any major price increases above the $65-$70 range in the near term.
OPEC+ Strategies and Market Dynamics
On the supply side, OPEC+ discipline is providing a solid floor under the market. We have seen Saudi Arabia and Russia extend their voluntary production cuts through the end of this year, and indications are they will maintain this tight supply policy into the first quarter of 2026. This ongoing commitment is the primary reason prices have not fallen further despite the weakening economic outlook.
Given these conflicting signals, we see a market that is likely to remain range-bound. Looking back at the extreme volatility of 2022-2023, where prices soared above $100 before falling, the current environment appears much more balanced. For the coming weeks, this points towards selling call options around range highs near $65 and considering buying puts if demand fears take over and break key support levels.
